by Marty Cook
Posted 1/7/2014 10:48 am
Updated 8 months ago
P.A.M. Transportation Services Inc. of Tontitown will purchase 675,000 shares of its outstanding shares as a result of its dutch auction in December.
Allen West, the company’s CFO, said the publicly traded transportation services company (Nasdaq: PTSI) originally planned to spend as much as $12.6 million to repurchase shares based on a projection that the auction would provide 600,000 shares at a maximum price of $21. The stock was trading in the neighborhood of $20 when the 30-day auction was started in early December.
The auction brought in more than 750,000 tender offers, and West said the company decided to adjust its purchase budget.
The offers included 675,000 shares up to a price of $20.50. Many tenders offered the shares at whatever price the company decided between $19-21, West said.
The total purchase of the shares at $20.50 will cost more than $13.8 million. The rules of the auction allowed the company to purchase up to 170,000 more share than the original goal of 600,000.
"We had decide how much over our budget did we want to go," West said.
The company isn’t done with repurchasing outstanding shares, West said. The board of directors had previously given the OK to buy 225,000 shares, an approval that was not affected by the auction purchases.
SEC regulations forbid P.A.M. from purchasing any stock until Jan. 14 or 10 business days from the conclusion of the auction. Shares of P.A.M. closed at $20.85 on Monday.